As the stock price continues to fall, some companies that issue convertible bonds face enormous back selling pressure, and not every company is as rich as Shuangliang Energy Saving (600481). Zhongding Co., Ltd. (000887) announced today that it intends to reduce the conversion price of the convertible bonds to resolve the huge financial pressure that may trigger the forced sale.
In February of this year, Zhongding completed the public issuance of convertible bonds and actually raised 283 million yuan in funds. The company implemented the 2010 dividend distribution plan on May 12 (equity registration day) this year. The conversion price of “Zhongding Convertible Bonds†was adjusted from the original RMB 25.31 to RMB 18.04 per share.
Pursuant to the terms of the sale-back, if the closing price of the company’s stock is lower than 70% of the current conversion price (ie, 12.628 yuan) for the duration of the convertible bond, the holder of the convertible bond has the right to The convertible bonds held in full or in part are sold back to the company at 103% of the face value (including the annual interest bearing interest for the current period).
The company's stock price closed at 12.05 yuan yesterday. From August 29 to yesterday, the company's stock price has closed below 12.628 yuan for 22 trading days, and the triggering of the terms of the sale of the sale seems to be just waiting.
According to the announcement, the revised conversion price will be determined at 110% of the higher average price of the company's stock trading and the average price of the previous trading day on the 20 trading days prior to the holding of the shareholder meeting to amend the conversion price. Before the correction, the pre-revised stock price shall prevail. If calculated at 110% of the yesterday's closing price, the revised conversion price is 13.255 yuan, down from the original conversion price of 18.04 yuan by nearly 30%.
The company will consider the proposal on October 14th. The controlling shareholder has issued a letter of commitment and will vote in favor.
In February of this year, Zhongding completed the public issuance of convertible bonds and actually raised 283 million yuan in funds. The company implemented the 2010 dividend distribution plan on May 12 (equity registration day) this year. The conversion price of “Zhongding Convertible Bonds†was adjusted from the original RMB 25.31 to RMB 18.04 per share.
Pursuant to the terms of the sale-back, if the closing price of the company’s stock is lower than 70% of the current conversion price (ie, 12.628 yuan) for the duration of the convertible bond, the holder of the convertible bond has the right to The convertible bonds held in full or in part are sold back to the company at 103% of the face value (including the annual interest bearing interest for the current period).
The company's stock price closed at 12.05 yuan yesterday. From August 29 to yesterday, the company's stock price has closed below 12.628 yuan for 22 trading days, and the triggering of the terms of the sale of the sale seems to be just waiting.
According to the announcement, the revised conversion price will be determined at 110% of the higher average price of the company's stock trading and the average price of the previous trading day on the 20 trading days prior to the holding of the shareholder meeting to amend the conversion price. Before the correction, the pre-revised stock price shall prevail. If calculated at 110% of the yesterday's closing price, the revised conversion price is 13.255 yuan, down from the original conversion price of 18.04 yuan by nearly 30%.
The company will consider the proposal on October 14th. The controlling shareholder has issued a letter of commitment and will vote in favor.
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